WHAT THEY ARE SAYING: USTR Defends the Rights of Dairy Exporters Under the USMCA

January 31, 2023

WASHINGTON – United States Trade Representative Katherine Tai today announced that the United States is establishing a dispute settlement panel under the United States – Mexico – Canada Agreement (USMCA) regarding Canada’s dairy tariff-rate quota (TRQ) allocation measures.  In this new panel proceeding, the United States is challenging Canada’s revised dairy TRQ allocation measures that use a market-share approach for determining TRQ allocations, and impose new conditions effectively prohibiting retailers, food service operators, and other types of importers from utilizing TRQ allocations.  Through these measures, Canada undermines the market access it agreed to provide in the USMCA.
Elected officials and industry leaders applauded Ambassador Tai’s announcement and emphasized the importance of Canada following through on their USMCA commitments.
Read more about what they are saying:
House Agriculture Committee Republicans: “Pleased to see @AmbassadorTai take action to ensure U.S. dairy producers have free and fair market access under the #USMCA. Canada must be held accountable if they continue to blatantly violate the tariff-rate quota provisions outlined in the agreement.”
House Agriculture Committee Democrats: “We support this request for a second panel to address Canada’s unfair dairy trade practices. USMCA was established to ensure fair trade, and Canada is not upholding their end of the bargain. This reluctance to come into compliance is hurting US dairy farmers. Thank you to Ambassador Tai for her continued commitment to guaranteeing that American farmers have access to foreign markets and our trading partners are operating in good faith.”
House Ways and Means Subcommittee on Trade Chairman Adrian Smith [R-NE]: “I applaud @AmbassadorTai for moving forward with a dispute settlement panel under USMCA to ensure U.S. dairy producers are treated fairly by Canada. Our trading partners must be held to their commitments and I appreciate the administration taking this important step.”
House Republican Conference Chair Elise Stefanik [R-NY]: “I am proud to announce that, following my advocacy, USTR is continuing to work to ensure our dairy farmers will receive well-deserved access to the Canadian dairy market. Our dairy farmers work hard to provide delicious and nutritious products for our communities and deserve the expanded market access they were promised as part of USMCA. I will continue to work to ensure Canada fully abides by its dairy market access commitments, and I will continue to advocate for results for Upstate dairy farmers.”
Senator Tammy Baldwin [D-WI]: “Our dairy farmers and cheesemakers rely on fair trade practices to grow their businesses and remain competitive on an international stage. I applaud Ambassador Tai for standing up to enforce the USMCA. I look forward to resolving this dispute with Canada as soon as possible to restore stability and fairness in the marketplace for Wisconsin’s dairy producers.”
Congresswoman Suzan DelBene [D-WA]: “We are 2+ years into the US-Mexico-Canada trade agreement & Canada continues to deny our dairy producers fair access to its shelves. Glad to see @AmbassadorTai supporting WA farmers by holding our trading partners accountable.”
Jim Mulhern, President and CEO of the National Milk Producers Federation: “Canada’s TRQ allocation system is not only a violation of USMCA — it directly harms American dairy farmers, processors, and other workers by unfairly restricting access to their market. USTR’s action is an important step in righting this wrong and sending a message that the U.S. will fight violations of trade deals in Canada and wherever else they may be committed.”
Krysta Harden, President and CEO of the U.S. Dairy Export Council: “The U.S. dairy community greatly appreciates the Biden Administration’s decision to prioritize steps to address Canada’s USMCA violations. Unfortunately, Canada has shown a pattern of not living up to the dairy commitments it has made in trade agreements. As long as they continue to drag their feet, we’ll continue to work with USTR and USDA to fight back, and propose retaliatory action if necessary.”
Michael Dykes, President and CEO of the International Dairy Foods Association: “IDFA is very grateful to Ambassador Tai and the entire U.S. government team for moving forward with this enforcement action against Canada, the resolution of which is a critically important matter for U.S. dairy producers and processors. We appreciate Ambassador Tai’s open and vigilant commitment to enforcing U.S. trade agreements to their fullest and maintaining a rules-based trading system.”
Brody Stapel, President of the Edge Dairy Farmer Cooperative and Wisconsin dairy farmer: “Additional market access into Canada is an important part of USMCA. International trade is key to economic growth and stability for dairy farmers and processors. Edge and our farmers appreciate USTR’s commitment to holding Canada to the agreement and giving the U.S. dairy community greater export opportunities as intended.”